The Increase in Earned Revenues of the ATC is One of the Arguments Proving the Effectiveness of Decentralisation, Yanina Kaziuk

The financial capability of local self-government in the 366 amalgamated territorial communities (ATCs) is gaining strength. The earned revenues of their local budgets increased almost by twice overthe first six months of the current year. The increase totalled UAH 1.9 billion, in comparison with the same period of the previous year. It was so informed by Yanina Kaziuk, Financial Decentralisation Coordinator of the Central Office for Reforms at the Ministry of Regional Development (with the assistance of the U-LEAD Programme).

She stated the data issued by the Ministry of Finance proving that the earned revenues of local budgets of the amalgamated territorial communities who transferred to direct inter-budgetary relations totalled UAH 3.9 billion.

The average amount of earned revenues per one resident of the amalgamated territorial community increased by UAH 616 (from UAH 640 to UAH 1,256).

The expert noted that the 207 ATCs where the first elections were held in 2016, in this year only, received 60% of the revenues to their local budgets from the personal income tax. The financial analysis proved that own resources of those ATCs, in comparison with the same period in the previous year, have increased by three times and totalled UAH 2 billion (+ UAH 1,374 million).

As regards the 159 ATCs whose budgets received 60% of the paid personal income tax already in 2016, the rate of growth of their earned revenues for that period increased by 41% (+ UAH 549 million), which indicator is higher than average in Ukraine (the rate of growth of the earned revenues of local budgets of Ukraine is 34%).

Inclusive of inter-budget transfers from the state budget, the revenues of the general fund of local budgets of the 366 amalgamated territorial communities totalled UAH 9 billion.

"The increase in revenues of the amalgamated communities proves once more that they have chosen the right way of development by having become active participants of the local self-government reform. The financial decentralisation made it possible for those communities to resolve the issues which could not have been resolved due to the lack of funds. The reform is working and yields positive results", Yanina Kaziuk commented.

The influx of own resources to all 366 amalgamated territorial communities over the period of January to June 2017, in comparison with the same period of 2016:

in total - UAH 3.9 billion (a nearly two times increase or by UAH 1.9 billion), in particular:

Inclusive of transfers from the state budget, the revenues of the general fund of local budgets of the 366 amalgamated territorial communities totalled UAH 9 billion.

The influx of own resources to the local budgets of the 159 amalgamated territorial communities over the period of January to June 2017, in comparison with the same period of 2016:

in total - UAH 1,875 million. (an increase of 41% or by UAH 549 million), in particular:

personal income tax totalled UAH 1,075 billion (an increase of 49%);

land tax totalled UAH 281 million (an increase of 18%);

excise tax totalled UAH 196 million (an increase of 17%);

flat-rate tax totalled UAH 235 million (an increase of 61%).

immovable property tax totalled UAH 22 million (an increase of 55%).

Inclusive of transfers from the state budget, the revenues of the general fund of local budgets of the 159 amalgamated territorial communities totalled UAH 4.2 billion.

The influx of own resources to the local budgets of the 207 amalgamated territorial communities over the period of January to June 2017, in comparison with the same period of 2016:

in total - UAH 2,049 million (three times increase or by UAH 1,374 million), in particular:

personal income tax totalled UAH 1,162 million;

land use fee totalled UAH 315 million (an increase of 19%);

excise tax totalled UAH 180 million (an increase of 22%);

flat-rate tax totalled UAH 308 million (an increase of 55%).

immovable property tax totalled UAH 26 million (an increase of 68%).

Inclusive of transfers from the state budget, the revenues of the general fund of local budgets of the 207 amalgamated territorial communities totalled UAH 4.8 billion.

Note. The information is provided with reference to official data of the Ministry of Finance of Ukraine on the basis of achievement of local budget targets by the amalgamated territorial communities prior to and after their voluntary amalgamation and after the acquisition thereby of the right to direct inter-budgetary relations with the state budget.